Haoliang Xu
UN Assistant Secretary-General, UNDP Assistant Administrator and Director for the Regional Bureau for Asia and the Pacific
How the guardians of the SDGs are mobilising finance for impact.
When I joined the UN in 1994, aid from rich countries to Asia-Pacific nations accounted for more than 10% of all money in the region. Today that figure is less than 1%. As economies grew, countries’ own resources dwarfed the inflow of foreign aid. This is a seismic shift in the global development system.
Our role has also changed. We at the United Nations Development Programme (UNDP) used to train officials, organise exchanges of experts and expertise and design processes. Nowadays, we not only help Asia-Pacific governments spend their own money for their own development, but we also help countries access new sources of financing.
One of the sources key to solving some of our most stubborn development challenges is impact investing – money invested for social good.
Impact investing could help 400 million living in poverty
We need impact investing because big challenges remain. Some 400 million people still live in poverty. Rising inequality, rapid urbanisation, ageing population, migration, extremism and environmental disasters all require sophisticated solutions.
The Sustainable Development Goals (SDGs) adopted by world leaders are clear and provide a framework of integrated solutions to the challenges. The 2030 Agenda is an ambitious plan, and UNDP is committed to help governments achieve that plan.
Governments, communities and policy-makers must collaborate
This has to be a collective effort, and we are bringing together governments, business, civil society, philanthropists, communities, volunteers and international partners. As we explored ways of engaging private capital for sustainable development, we learnt about and embraced impact investing. Asia is an emerging power in this area. There is growing appetite, and strong demand.
From the global or regional perspective, we see the power of impact investing to mobilise and channel capital to areas and countries most in need. On the ground and at the local level, we work with governments and various partners to identify different entry points and the best vehicles to address the greatest challenges: impact fund for Bangladesh, social enterprise fund for Sri Lanka, Green Sukuk bond for Indonesia, sustainable economic zones in Cambodia, etc.
Through our experience, we have witnessed how impact investing offers great potential for collaboration and partnership between stakeholders. It is not a panacea by itself, but it brings out the best synergies and complementarities between the public and private sector.
Supporting ecosystems for wider community gain
Meanwhile, we are also supporting the ecosystem development in many countries, because we understand that, without a healthy ecosystem and an enabling environment, it will be hard to bring impact investing to scale.
For instance, we support youth entrepreneurship, incubators and accelerators, business and human rights, and we work with governments to develop the right policies to promote new business and investment models for sustainable development.
The SDGs have opened up extraordinary markets and huge opportunities for people to make a difference with their money, and as the guardians of the SDGs, we are ready to work with you to align capital for a better humanity, and it is high time that we embarked on this journey.